Many issues need to be sorted through during a divorce. The event itself is emotionally charged. However, you should not allow the strength of your feelings to cloud your judgment about material interests by hiding assets for your financial benefit.
California is a community property state, which means that property acquired during the marriage must be divided equally between the two spouses. Community property is distinguished from separate property, which includes everything you owned before the marriage. Separate property may also include items and gifts you were given during the marriage that were meant exclusively for you.
High Net Worth Divorces
These types of divorces differ from most in that they include the division of a high-value estate that has come to the couple through inheritance or through the development of business or investment. High net worth couples typically own assets with a combined value of $1,000,000 or more.
The complexities of discerning and dividing the assets in a high net worth divorce tend to be considerable. If you are the spouse who made a vast fortune while you were married, then you will need a top legal team to secure your interests. This is especially important if you founded and built up a large business. In such cases, you may need to share the financial dividends of the company, but you may be able to keep operational control through negotiations during the division of assets.
The Complexities of Hiding Assets
With the possibility of financial loss in a high net worth divorce, one party may consider hiding assets or actually hide them without the knowledge of their spouse. Hidden assets are typically seen as a form of financial preservation, as they may increase their wealth following their divorce finalizes and their assets can be uncovered. However, it can have severe consequences if caught.
What Is a Hidden Asset?
When assets are hidden by one party, it is done without the other party’s knowledge and for financial benefit. Assets may be considered hidden if:
- They were underreported or undervalued
- They were gifted to another person with the sole purpose of retaining the assets following the finalization of the divorce
- They were gifted to others without the permission of one spouse
- They were put in a separate, nondisclosed account by one party
Hidden assets can be items of any value — as long as they were not accurately reported, they may be considered hidden.
Penalties of Hiding Assets
You may be frustrated at the thought of sharing half of everything you have earned with your spouse. As a result, you may be tempted to hide certain assets. Beware though — doing so may prolong divorce proceedings and prompt severe financial or legal penalty if caught.
During your high asset divorce, your spouse’s legal team will most likely hire a forensic accountant to ensure their best interests are represented. Forensic accountants are trained to find hidden assets and piece together financial information based on old documentation. If the court discovers that you did not give a full accounting of your money and assets, you may be ordered to provide more than half of your fortune to your spouse as a penalty.
What If I Suspect My Spouse of Hiding Assets?
On the other hand, if you suspect your spouse of hiding assets from you in your divorce, it would be in your best interest to contact a divorce lawyer as soon as possible. Your attorney can hire a forensic accountant to look into your finances and determine if there are any hidden assets or unaccounted-for payments in your accounts. Your high asset divorce attorney will also alert the court to the possibility of hidden assets and can request a reevaluation of assets and their determinations as separate or community assets.
Murrieta High Asset Divorce Lawyer
When undergoing a high asset divorce, you want to rest assured that your financial future is in good hands. The high asset divorce attorney at Law Offices of Michael D. Iverson, APC is experienced in obtaining favorable outcomes for clients in complex divorce matters. We can provide you with better solutions to help protect your financial future.
If you need legal assistance with hidden assets, call us today at (951) 418-2770.